Economic Survey 2022 : Monetary Management and Financial Intermediation – UPSC GS3

Monetary Management and Financial Intermediation:
  • The liquidity in the system remained in surplus.
  • Repo rate was maintained at 4% in 2021-22.
  • Reserve Bank of India undertook various measures such as G-Sec Acquisition Programme and Special Long-Term Repo Operations to provide further liquidity.
  • The economic shock of the pandemic has been weathered well by the commercial banking system:
  • Bank credit growth accelerated gradually in 2021-22 from 5.3% in April 2021 to 9.2% as on 31st December 2021.
  • The Gross Non-Performing Advances ratio of Scheduled Commercial Banks (SCBs) declined from 11.2% at the end of 2017-18 to 6.9% at the end of September, 2021.
  • Net Non-Performing Advances ratio declined from 6% to 2.2% during the same period.
  • Capital to risk-weighted asset ratio of SCBs continued to increase from 13% in 2013-14 to 16.54% at the end of September 2021.
  • The Return on Assets and Return on Equity for Public Sector Banks continued to be positive for the period ending September 2021.
  • Exceptional year for the capital markets: Rs. 89,066 crore was raised via 75 Initial Public Offering (IPO) issues in April-November 2021, which is much higher than in any year in the last decade.

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